Interesting comments from a new Liberum note on another gaming sector company which chime with KWS' recent statements about the potential of streaming:

"Streaming could provide new monetisation possibilities

There have been a number of public comments from the major platform providers (Sony, Microsoft etc.) and possible new entrants to the gaming sector about the potential to launch new delivery and monetisation models, which could accelerate growth for the whole computer gaming sector....Google is already testing a streaming service (Google Project Stream), which is expected to be launched later this year and there has been speculation in the last few days that TMT giants such as Amazon and Verizon could also be preparing to announce new platforms.

We would expect to see these initiatives reflected in the income statements of the UK players in the form of potential development income, license revenue (there could be deals for periods of exclusivity) and possibly partnerships for the major IP developers.

Platform economics in IP developers' favour

This also comes as the Steam PC store has announced cuts in its revenue share agreements with its largest IP partners (this currently kicks-in for games generating more than $10m of annual sales....) and Epic Games has recently challenged Steam's dominance backed by a 12% revenue share model. All these factors point to potential revenue and margin upside for the whole sector over the next 24months....

China approvals resumed, risks around future franchises reduced

The Chinese central government froze video game approvals from March 2018 onwards. The number of games approved since March 2018 has fallen to just 353, against 716 games approved in January 2018 alone. Approvals have resumed in December and, since then, a total of 75 games have been approved, although big names such as PlayerUnknown's Battlegrounds and Fortnite are yet to be granted commercial licenses......A friendlier attitude towards the video game industry by the Chinese government would clearly be helpful."

acquisitions were bought partly by issue of shares - 310k shares perhaps that's why the unexpected drop after such good news and now low pe and growing fast - seller may be flushed now so expecting decent bounce from here.

Seems no actually investors around,just the lump and dump crew,fundamentals are hugely strong,how has this halved in value just about in 6 months,wtf am I missing,no doubt I’m a complete numpty left holding the baby but I just don’t get it???

Datafeed and UK data supplied by NBTrader and Digital Look.
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